The success story of Morotola’s RAZR cell phone is emblematic of the more active role design departments are playing in the formulation of corporate strategy in progressive companies. The RAZR has now sold more than 50 million units, nearly as many as Apple has sold iPods-but in less than half the time. Like the iPod, it has also been called a company-changing product. As well as boosting market share and profits, it also provided the momentum for transforming Motorola from a technology to a lifestyle-driven company. Jim Wicks, vice president of consumer experience design, remembers consumers likening its products to ‘some Cadillac that nobody wants’when he joined the company in 2001.
However, the RAZR’s success and Motorola’s subsequent rejuvenation around it is no textbook case of grand top-down strategy. It emerged at a time of cultural change at the top of the company and then became the catalyst around which the company reinvented itself. The late Jeffrey Frost was a key pathfinder for the new Motorola. He left Nike to join the company as chief marketing officer in 2001, and he pioneered the Hello Moto campaign in 2002. Frost had grasped the start of a big-picture market shift from features to fashion. At this point, the brand’s communications had been given much-needed fizz, but the company didn’t have products that could deliver on the promise.
In 2003, the genesis of such a product was spotted roaming the Advanced Development Department in the form of a mocked-up superthin phone, which had been achieved by reconfiguring internal components. Motorola assembled a skunkworks team of designers and engineers, some of whom had recently been pulled off another high-end phone project. Project Razor Clam was given the objective of developing and launching a low-volume ‘statement product’ within the year.
The pressure was on to produce a knockout phone with the goal of building more buzz than sales, and therefore normal rules would not apply. In the tradeoff between thinness and functionality, the team would lean toward the former. Focus was the name of the game. Time constraints meant that corners were cut and rules broken: For example, the usual consumer tests and network operator consultations were bypassed. Also, the lack of the usual constraints associated with a mass product, and the singular pursuit of the Wow! factor, allowed for the use of high-end materials and usability tradeoffs. One such compromise was going with a handset width that the usability team advised was 4 millimeters too wide.
Another cornerstone of the story is Ed Zander, who joined as CEO midway through the RAZR’s development. As well as encouraging the project, he instigated a bonus structure to focus the whole company on the end consumer and to reduce inter-departmental wrangling. The initial marketing plan was to label the phone the V3, in line with Motorola’s naming convention. However, Frost, who had been tracking the project, did not like the idea of such an elegant phone having such a pedestrian name. Inspired by the project code name, he championed the four-letter RAZR and got behind the project with a strong communications campaign.
The RAZR V3 was released in November 2004 as an exclusive fashion phone, with a high price of $500, along with a service agreement in the US, and the unsubsidized price of $2,000 in Russia. It was an instant hit, generated buzz in all the right circles, and sold a very respectable 0.75 million units in the final quarter of 2004. In the fast-moving world of mobile phones, and particularly in an era of restless design studios, the natural reaction would have been self-congratulation and a move to begin work on the next killer product-but not this time.
The 2005 budget that had planned around selling 2 million RAZRs was revised upward by the new head of the cell phone division to a target of 20 million. This threw the gauntlet down to the marketing and design departments to extend the product’s success well outside the original market niche. The iconic success of the RAZR made the job of developing a design language extension platform easier, since the usual competing views were largely absent, replaced by enthusiasm for building on a success story.
A black variant found its way into the 77th Academy Awards gift bags, and was released in early May 2005; the price of the standard V3 was lowered to a mid price point around the same time. The pink version became a legendary Christmas success in the UK in the same year. Early 2006 saw the launch of the lower priced SLVR family – an articulation of the RAZR design language into a candy-bar format. The three different SLVR models share a similar appearance, but are equipped with feature sets to hit different price points. In July 2006, the company announced two more RAZR offspring- the narrower, taller, and exquisitely finished KRZR K1 clamshell; and a slider format called the RIZR.
While critics have accused Motorola of milking one idea and not having a follow-up, a counter point of view is that the company has pioneered a more mature way of managing a product lifecycle. Its focus on a small number of cell-phone product platforms, such as the RAZR and the PEBL, is analogous to the automotive industry, in which marketing resources promote the platform sub-brand rather than individual models. Advertising features the top-of-therange ‘hero’ product, under whose halo the cheaper variants bask. Not only does this platform approach make for effective marketing, but it also allows designers to focus on doing a few things well and helps reduce the total number of component variants to be engineered, sourced, and managed.
Germade makes it clear that the long-term success of the RAZR should be firmly laid at the feet of senior management and their vision: ‘They saw more sales potential than perhaps the design team did, and really showed leadership through pricing and communications.’ And he emphasizes the importance of ‘designing the right culture’ in the company if strategy is to remain alive and relevant. ‘We have themes and hypotheses that we use as guides-until they are proved wrong.’ One such guideline is that consumers should be able to identify a Motorola phone from three meters away. Annual strategy reviews also ensure that the design department remains aligned with the corporate and marketing objectives. ‘Branding from the inside out’ is the phrase Germade uses to underline this new product-driven approach; when the product is the brand, “consistency of implementation is really important.”
Jim Wicks sums up the joined-up way in which his company is now able to build strategy: ‘What really defines our design group’s positioning now versus three years ago is that it’s really tightly woven into the way we plan our products, our strategies, our marketing, and how we prioritise which technologies we go after.’
The RAZR story provides a strong case of an emergent, learning, and responsive strategy. It was not drawn up in glorious isolation and handed down to the implementers. Its authors knew the market was changing and that Motorola had to change too, and they thought RAZR could contribute to the changing perceptions of an elite. At the same time, through intervening in the market, Motorola discovered potential far outside this fashion niche. This traditionally technology-driven company was open enough to realise that it had underestimated consumer demand for high style, astute enough to spot the long-term potential of an initial success, and agile enough to rapidly shift its priorities from technology to lifestyle. Most impressive, to those familiar with corporate life, it rapidly aligned its design, marketing, and technology strategies around a platform approach and reaped the rewards.
It is also instructive to note that such success was achieved with a notoriously weak user interface. This suggests two lessons: first, do not underestimate the power of the blink factor of product identity in the consumer experience; and second, think what Motorola could do if it fixes its UI, which it seems more than capable of doing.